Just last month, Shoprite's chief executive made it clear the company had no plans to become a bank. "I am after the transaction," Pieter Engelbrecht told Bloomberg in an interview on 1 September. "We are not bankers, we are retailers." On Friday, Bloomberg reported that Shoprite is in talks with Investec about a banking partnership anyway, citing people familiar with the matter.
Neither company has confirmed it. Shoprite said it would share information about any partnership with the market when it becomes available, and Investec said it does not comment on speculation. The people Bloomberg spoke to say the structure is still being worked out, and that there is no certainty of a deal.
A bank account in all but name
Shoprite already offers something that works a lot like a bank account. Its Money Market Account lets customers deposit and withdraw cash, send money and pay for things, with no monthly fee and a R5 charge for cash withdrawals. More than 4.3 million South Africans use it, and African Bank provides some of the everyday banking behind the scenes. A Mastercard debit card linked to the account is being tested, and Shoprite's annual report says it will expand into "a fuller bank account experience".
What each side would bring
A partnership with Investec, as Bloomberg describes it, would let Shoprite move into things like lending without having to become a bank itself. Shoprite would bring millions of customers, 3,710 stores and one of the country's largest pools of shopping data. Investec would bring the technology, the regulatory know-how and lending under its own banking licence.
Pepkor builds its own, Sanlam borrows GoTyme's
That is a different route from Pepkor, the owner of Pep and Ackermans, which has conditional approval to set up a bank and applied at the end of March to be registered as one. Bloomberg reported at the time that Pepkor had also considered teaming up with Investec before going it alone. It is much closer to what Sanlam did with GoTyme Bank: the regulator approved Sanlam selling GoTyme's accounts to its customers, the licence stays with GoTyme, and Sanlam soft-launches on 1 November.
If Bloomberg's sources are right, Shoprite could end up offering many of the services you would expect from a bank without ever becoming one, which is what its chief executive said he wanted all along. Until either company confirms it, the Investec route is something Bloomberg has reported, not something Shoprite has announced.
